Aye, Captain... Fair question. And the short answer is no, but I shall elaborate, as I sometimes do.
I am not "as optimistic" as I once was. All my opinion on this page, of course, but...
They once had killer technology and a highly advantageous timeline in which they could have been second to market in general robotic surgery (Trixie never really counted in my book; no OR can realistically give up that much space). All they needed to do was a "quick" (12 to 14 month) re-design to add redundancies and manufacturability goals and meet the then-new Human Factors Engineering guidelines (which bit Trixie in the backside with their offering #2), then regulatory clearances.
They still have the killer technology, with a few new features and some parts now substantially re-designed; mostly worthwhile upgrades to the design but leaving investors scratching their heads, wondering why they couldn't have rolled out upgrades to fielded units instead of delaying release for two years.
Meanwhile, ISRG put their SP on the market. Okay, enough hospitals despise ISRG that they would love to deal with someone else, maybe a newcomer who would bend over backwards to please their customers, or maybe a well-established company just entering the robotic surgery market. But SP is something patients want. It's much like 18 years ago when prostate patients said "It's gotta come out, but I want it out with that robotic so I can still have sex." Except now it's "I need my gall bladder out, but I don't want a handful of scars there for the rest of my life." SP is a winner, regardless of who's SP it is.
A little more fast forward, and Medtronic and Verb show off their latest creations. Both are multiport systems, when patients want single port. Why would companies with billions of development dollars availabile not develop something that the end custmer actually wants? It worked for ISRG 20 years ago. Are these competitors relying on ISRG's old lapsed patent portfolio? Does this mean ISRG and Titan have sufficient IP protection that everyone else is effectively blocked from SP for general/abdominal surgery for the next ten years? Maybe... TBD, of course. But these big names carry a lot of weight. Medtronic will sell a fair number of multiport systems because they have a big name and a big market presence in surgery in general - coupled with the common disdain for ISRG and their traditional heavy-handed business strategy. The viable alternatives will have some success. But MDT indicated they are about 2 years away from the market, and the Verb system has no such indication, and looks suspiciously like marketing information (not legal for an unapproved medical device in the US - was it leaked? How did this get out?). Given the dearth of information in public filings, it is not unreasonable to assume that Verb is also at least two years from their first sale.
Titan, as a viable alternative and having the patient-preferred technology, still has a great future ahead of it. Previously, my level of optimism included factors like market opportunity and the prospect of another 50- to 100-bagger investment (I bought ISRG in 2003 for $11.65 - wish I had second-mortgaged my house if I had any idea just how well it would do). The Titan delays have been heartbreaking and bank-busting. Shorters have held our share price down in the weeds, so subsequent raises have caused crippling dilution, and larger investors are scared because of our share price history - a vicious cycle. A 100-bagger for me? No longer possible, despite averaging down at every opportunity while trying to maintain my ownership percentage(currently 0.155% of the outstanding shares are mine). A newbie buying today for $1.10 a share? Stands to reap a great ROI in a while. Me? If I only get a ten-X on this, I still retire very happy. A 20x to 50x are not out of the question, but as dilution keeps ramping up, my profit factor keeps ramping down.
We need REAL NEWS and REAL FAST to get our share price up... I don't see it happening. FDA IDE approval? It is huge news; it means the FDA is sufficiently satisfied with safety, preliminary efficacy, meeting Human Factors Engineering guidelines, etc. It means we meet 90% of the eventual clearance criteria. But 75% of IDE filings are denied first time (usually FDA wants supplemental info). Notice Titan says we file in October and get approval in December, despite a 30-day approval cycle by FDA? We have the first rejection built into our schedule. It is normal and expected, and our team has planned appropriately for it. But when (and if) the initial rejection hits, I'm guessing our PPS will get crushed even further. I finally set a little money aside for when this happens - I wouldn't be surprised to see 50 to 60 cents. Then we get the IDE approval, and rebound back to maybe just under a buck... Market cap for a ground-breaking multi-billion-dollar-market device that got IDE approval should be at a minimum in the $500M to $1.5B range.
Confidence level for success? I'd say somewhere in the 80+% range, regardless of buyout or go it alone - at this point, I'd prefer the buyout just to get it over with, but a Titan solo performance would probably provide higher eventual yields on our investments. I don't need this level of stress in my life any more! Buyout gets it over with, and I can take the money and run. A Titan solo act drags this out for another 3 to 5 years. Three years ago, I had time to wait for that. Now...
Optimism? Yes, I remain optimistic. I believe we have the goods. I believe my investment will get me to an early retirement, just not as early as it should/could have. And every additional round of dilution reduces my optimism further as a linear relationship to how badly it reduces my eventual ROI.
Is it a no-brainer? It never was. But with every dark turn this seems to have taken, there is a little more light shining through the cracks, like newcomers who are developing outdated technologies to "compete." Each of these new unveilings is potential competition for a bidding war, especially given the lukewarm reception at best for Medtronic's system. The market knows where the future is at, and that has to have been a big awakening for MDT management. Fingers crossed... but I have learned that nothing is a slam dunk with Titan.
Reply to:
cptjsd Wednesday, 10/09/19 12:47:35 AM
Re: 66Mustang post# 97848
Post #97881 of 97884
Mustang...serious question. Are you still as optimistic about this investment as you have been in the past? I was at one time a cheerleader, believed in this company and “saw the light”. After years AND years of changing timelines and disappointment...I lost faith and saw other investors over the years lose their confidence and change their tune on Titan. Where is your head at regarding this investment? Is this still a no-brainer to you?
